Basic Policies on Corporate GovernancePreamble
PACIFIC METALS CO., LTD. (hereinafter, the “Company”) has established and published these
Basic Policies on Corporate Governance (hereinafter, “these Basic Policies”) by resolution of theBoard of Directors, with the aim of achieving sustainable growth and enhancing medium- to longterm corporate value, based on its company philosophy: “Leverage the power of people to deliver theearth’s resources in more useful forms and contribute to the happiness of humankind.”
These Basic Policies indicate the Company’s views on corporate governance and corporategovernance frameworks. Should the Company amend these Basic Policies based on changes in its
business or environment, it shall disclose these amendments in a timely and appropriate manner.

Chapter 1. General Provisions(Basic Views on Corporate Governance)
Article 1. The Company shall enhance corporate governance in accordance with the following basicviews.
(i) The Company shall respect the rights of all shareholders and ensure equality.
(ii) The Company shall collaborate with all stakeholders, including shareholders, consumers,
business partners, employees, and local communities, sincerely and appropriately,
considering their interests.
(iii) The Company shall proactively disclose information that could serve as a basis forinvestment decisions, in addition to disclosing information appropriately in compliancewith relevant laws and regulations.
(iv) The Company’s Board of Directors shall be responsible for achieving sustainable growthand maximizing medium- to long-term corporate value based on its fiduciary responsibility
to shareholders. To this end, the Company shall establish a fair and transparent management
structure by introducing an executive officer system to separate decision-making andbusiness execution functions and by strengthening the business execution supervisory
function through the appointment of outside officers (Outside Directors and OutsideAuditors).
(v) The Company shall engage in constructive dialogue with shareholders to achievesustainable growth and maximum medium- to long-term corporate value.

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Chapter 2. Ensuring Shareholder Rights and Equality(General Shareholders Meeting)
Article 2. The Company shall dispatch the Notice of Convocation of the Annual General Shareholders
Meeting at least three weeks before the date of the meeting, to allow shareholders time to fully
examine the content of the proposals and appropriately exercise their rights. Moreover, theCompany shall disclose the Notice of Convocation through the securities exchange and on its
corporate website prior to dispatching it.
2. The Company shall endeavor to enhance the environment for the electronic exercise of voting
rights to enable all shareholders to appropriately exercise their voting rights.
3. The Company shall disclose an English translation of the Notice of Convocation of the Annual
General Shareholders Meeting to enable all shareholders to appropriately exercise their votingrights.
(Ensuring Shareholder Equality)
Article 3. The Company shall facilitate the exercise of rights by shareholders and engage in timely andappropriate disclosure to prevent any information disparity between shareholders, to equally
secure the rights of all shareholders.
(Cross-shareholdings)
Article 4. The Company shall hold shares of other companies as cross-shareholdings to maintain orstrengthen business relationships and enhance the medium- to long-term corporate value ofinvestee companies and the Company.
2. When exercising voting rights associated with cross-shareholdings, the Company shallconsider whether the relevant proposal would contribute to enhancing the corporate value ofthe investee company and the Company, as well as factors such as the return from the business
relationship and shareholding.
3. The Company shall verify factors such as the medium- to long-term economic rationale andfuture outlook for each individual cross-shareholding, based on the conditions presented in theprevious paragraph, and the purpose and rationale for each shall be explained periodically at
the Board of Directors’ meetings.
4. Based on the results of the above verification and other factors, the Company shall consider
the reduction of its cross-shareholdings in a phased manner.
(Related Party Transactions)
Article 5. In cases where the Company plans to conduct related party transactions with Directors,
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subsidiaries, or other related parties, the Company shall obtain the prior approval of the Boardof Directors to ensure that such transactions do not harm the common interests of the Companyand its shareholders. Moreover, where the Company has conducted related party transactions,the details of these transactions shall be periodically reported to the Board of Directors.

Chapter 3. Consideration for the Interests of Stakeholders(Corporate Code of Ethics and Standard of Corporate Conduct)
Article 6. To ensure that its officers and employees behave in an ethical manner, the Company has
established the Corporate Code of Ethics and Standard of Corporate Conduct by resolution ofthe Board of Directors, and disclosed these on its website.
2. The Company shall conduct a review of the Corporate Code of Ethics and Standard ofCorporate Conduct each year. Any amendments shall be approved by the Board of Directors.
(Relationships with Stakeholders)
Article 7. The Company shall consider the interests of all stakeholders, including shareholders, toenhance corporate value in the medium and long term.
2. The Company has established a whistle-blowing system to enable all stakeholders, including
shareholders, can report information on legal and regulatory violations at the Company, basedon the Rules of Whistle-blowing System. These rules stipulate that whistle-blowers shall not
be subject to disadvantageous treatment from the Company as a result of making this report.
(Roles of Corporate Pension Funds as Asset Owners)
Article 8. In managing its corporate pension funds, a person in the Company’s Personnel & Labor
Relation Dept. receives regular reports from the external fund manager, and the Company has
established a system that enables timely and close coordination with the fund manager.
2. Based on the initiatives described in the previous paragraph, the Company shall appropriately
manage any conflicts of interest that may arise between pension fund beneficiaries and theCompany.
(Response to Sustainability Issues)
Article 9. The Company perceives its response to sustainability issues, including consideration for
global environmental issues such as climate change, respect for human rights, considerationfor employee health and working environment, fair and appropriate compensation, fair andproper transactions with trading partners, natural disasters and other crisis management, as a3

key management issue, not only for risk mitigation but also in terms of revenue opportunities.
The Company shall proactively and actively consider initiatives to address these issues fromthe perspective of enhancing corporate value in the medium and long term.

Chapter 4. Ensuring Appropriate Information Disclosure and Transparency(Information Disclosure Policy)
Article 10. The Company shall determine policies concerning risk management, internal controlsystems, legal and regulatory compliance, and other issues, based on the Companies Act andother relevant laws and regulations, and disclose these policies in a timely and appropriatemanner.
2. The Company shall disclose financial and non-financial information in a timely andappropriate manner, using fair, detailed, simple and accessible methods, in accordance withthe provisions of the Companies Act, the Financial Instruments and Exchange Act, and otherrelevant laws and regulations, as well as the rules of the securities exchange. The Company
will actively disclose information as necessary, even if it is not required by the relevant laws,regulations, and other rules.

Chapter 5. Duties of the Board of Directors, etc.
Section 1. The Responsibility of the Board of Directors as a Supervisory Organ(Role of the Board of Directors)
Article 11. The Company’s Board of Directors decides on important matters prescribed in the agenda
standards of the Board of Directors Regulations, in addition to matters prescribed by therelevant laws and regulations and the Company’s Articles of Incorporation.
2. The Company’s Board of Directors delegates to Executive Officers swift decisions on theexecution of business, excluding the matters described in the previous paragraph.
(Role of Independent Outside Directors)
Article 12. The Company’s Independent Outside Directors shall validate and evaluate the Company’s
management results, etc. as appropriate, in the context of medium-term business plans andimplementation plans (single fiscal year business plans), and express opinions on theCompany’s senior management from the perspective of the interests of shareholders and otherstakeholders.

4(Chairperson of the Board of Directors)
Article 13. The Chairperson of the Company’s Board of Directors shall be appointed by the Board ofDirectors, as prescribed in the Company’s Articles of Incorporation.
2. The Chairperson of the Company’s Board of Directors shall endeavor to raise the quality ofdiscussions by the Board of Directors and ensure the effectiveness and efficiency of Board ofDirectors meetings.
Section 2. Effectiveness of the Board of Directors(Composition of the Board of Directors)
Article 14. The Company’s Board of Directors shall have no more than fifteen members, as prescribedin the Company’s Articles of Incorporation. No less than one-third of these shall be
Independent Outside Directors.
(Directors’ Qualifications and Nomination Procedures, and the Diversity of the Board of Directors asa Whole)
Article 15. The Company shall select Directors who possess outstanding character, insight, andabilities, as well as extensive experience and high ethical standards.
2. The Company shall select Directors with regard to diversity, in terms of factors such as gender,age, nationality, and skills.
3. The term of office of all Directors of the Company shall be one year, and they shall beappointed by resolution of the Annual General Shareholders Meeting.
4. New candidates for the office of Director of the Company shall be selected based on thestandards set forth in this article, and determined by the Board of Directors.
(Policies and Procedures for the Appointment and Dismissal of Senior Management)Article 16. The Company shall select senior management from among the Directors selected based on
the conditions set forth in the previous article, by resolution of the Board of Directors, withregard to factors such as past performance and experience.
2. Should the Board of Directors judge that a senior manager has committed a serious violationof laws, regulations, or the Company’s Articles of Incorporation, the senior manager shall bedismissed in accordance with the procedures prescribed in the Companies Act.
(Auditors’ Qualifications and Nomination Procedures)
Article 17. The Company shall select Auditors who possess outstanding character, insight, and abilities,
as well as extensive experience and high ethical standards.
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2. At least one of the Company’s Auditors shall possess appropriate insight into finance andaccounting.
3. The Company shall select Auditors with regard to diversity, in terms of factors such as gender,age, nationality, and skills.
4. New candidates for the office of Auditor of the Company shall be selected based on thestandards set forth in this article, and determined by the Board of Directors, with the consentof the Board of Auditors.
(Establishment of the Nomination and Compensation Committee)
Article 18 The Company has established the Nomination and Compensation Committee with the aimsof reinforcing the fairness, transparency, and objectivity of processes related to the nominationand compensation of Directors and Executive Officers and further enhancing the Company’s
corporate governance.
2. The Nomination and Compensation Committee shall be composed of at least three and not
more than five members with a majority of Independent Outside Directors, and shall be chairedby an Independent Outside Director as filed with the Tokyo Stock Exchange.
(Role of the Nomination and Compensation Committee)
Article 19. In response to inquiries from the Board of Directors, the Nomination and Compensation
Committee shall mainly deliberate on matters related to the appointment and dismissal ofDirectors and other officers, the compensation of Directors, and matters approved by othercommittees regarding the nomination and compensation of Directors, and shall provide advice
and recommendations.
2. Basic matters concerning the Nomination and Compensation Committee are set forth in theNomination and Compensation Committee Regulations.
(Duties of Directors)
Article 20. Directors of the Company shall collect sufficient information to perform their duties, andshall actively express and discuss their opinions.
2. Directors of the Company shall perform their duties as Directors by demonstrating the abilities
expected of them and spending sufficient time on the Company’s business.
3. Directors of the Company shall assume office with an understanding of the relevant laws andregulations, the Company’s Articles of Incorporation, the Board of Directors Regulations andthe Company’s other internal regulations, and a full understanding of their duties.

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(Policies on the Personal Enhancement and Training of Directors and Auditors)
Article 21. The Company shall provide Directors and Auditors with opportunities to undertake any
training they need to perform their respective roles and duties, in a timely and appropriatemanner.
2. On the appointment of an outside officer, the Company shall provide a briefing centered on its
business description, internal regulations, and financial condition(Operation of Board of Directors Meetings)
Article 22. Materials concerning agenda items and proposals to be submitted at meetings of theCompany’s Board of Directors shall be distributed in advance of the date of the meeting, tofacilitate fuller discussion at meetings.
(Outside Officers’ Access to Internal Information)
Article 23. Outside officers of the Company may, whenever they deem necessary or appropriate,request explanations or reports from Directors, Executive Officers, or employees, or request
the submission of internal documents.
2. The relevant divisions of the Company shall respond to requests for the provision of
information to outside officers in a timely and appropriate manner.
(Council of Outside Officers)
Article 24. The Company shall hold regular meetings of the Council of Outside Officers, composed ofoutside officers, to discuss matters such as the Company’s business and corporate governance.

(Evaluation of the Effectiveness of the Board of Directors)
Article 25. The Company’s Board of Directors shall periodically analyze and evaluate theeffectiveness of the Board of Directors as a whole, with the aim of improving the functions ofthe Board and thus enhancing corporate value. The Company shall disclose a summary of theresults of this analysis and evaluation in a timely and appropriate manner.

7Section 3. Compensation System(Policy on Determining Compensation and Other Related Matters for Directors and Other Officers)
Article 26. Compensation, etc. for Directors of the Company shall be linked to the long-term interestsof shareholders, and shall be appropriate, fair, balanced, and able to raise Directors’ motivation
to strive for the Company’s sustainable growth and the maximization of corporate value in themedium and long term.
2. The Board of Directors shall determine the amounts of compensation for Directors reflecting,in a certain proportion, elements of performance-linked compensation, based on the regulations
concerning officers’ compensation established by the Company in accordance with theprovision set forth in the previous paragraph.
3. Notwithstanding the provisions of the previous two paragraphs, compensation, etc. forIndependent Outside Directors shall reflect their duties, and shall include no elements of stockrelated compensation or other forms of performance-linked compensation.
4. Compensation, etc. for Directors of the Company shall be within the aggregate limits
established by resolution of the General Shareholders Meeting, in accordance with theprovisions of the Articles of Incorporation.
5. The Company shall use an appropriate method to disclose the amount of compensation, etc.
paid to Directors and other officers.

Chapter 6. Dialogue with Shareholders(Dialogue with Shareholders)
Article 27. The Chairperson of the Board of Directors shall endeavor to ensure that the opinions ofshareholders are thoroughly shared with all members of the Board of Directors.
2. The Company shall enhance systems to promote constructive dialogue with all shareholders
by establishing the IR Committee led by the Director in charge of investor relations.
3. The Company shall disclose various information in a timely and appropriate manner, based on
the Information Disclosure Policy set forth in these Basic Policies, and engage in constructive
dialogue with shareholders. When engaging in dialogue, the Company shall appropriately
manage insider information and take every precaution to prevent information disparity betweenshareholders.

8History of Revisions to these Basic Policies
Established: November 11, 2015
Revised: June 29, 2017
Revised: December 12, 2018
Revised: May 20, 2021
Revised: June 24, 2022

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